Coke stock split could boost Emory's endowment value

Emory's 19.5 million shares of Coca-Cola stock, valued at $1.5 billion, will become 39 million shares on May 13 after an April 15 vote by Coca-Cola shareholders to split the stock two for one.

The shareholder action means that anyone owning Coke stock on or before May 1 will have their stock split two for one beginning with trading on May 13.

"While that gives us more shares to talk about, the split does not immediately change the value of our holdings," said Wayne Coon, associate vice president for endowment investment. About 57 percent of Emory's $2.5 billion endowment is invested in Coca-Cola common stock.

The stock, which currently sells for $84 a share, will sell for $42 a share beginning May 13. "The real question is whether more folks will now buy shares at the lower price and continue to drive the price of the stock up," said Coon. "If that happens, then the value of our endowment will definitely be positively affected. When you're holding 40 million shares of stock in one company, a change in its stock price of even one quarter of a point can mean a loss or gain of $10 million. Now, for every dollar the price of Coke stock goes up, the value of our endowment will increase by $40 million."

Emory's endowment is ranked sixth nationally among university endowments and provided $48.3 million of revenue in fiscal year 1995, which is 4.4 percent of Emory's total budget of $1.1 billion.

--Jan Gleason

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